Deploying AI To Assist Board Decision-Making

AI tools are increasingly being used by boards of companies (both at a board level and on an ad hoc basis by individual directors) to analyse financial and accounting data; market trends; the competitor landscape and various other issues with a view to gaining a deeper understanding of the performance of the business and to make (hopefully) more informed decisions. 

However, as AI tools become more embedded in board-decision making processes, the line between human and machine decision making becomes increasingly blurred. The deployment of those AI tools to support the decision-making of a board of directors of an English company engages several overlapping directors' duties under the Companies Act 2006 (CA 2006). While there is no prohibition on boards using AI as an aid, the statutory framework imposes constraints that create meaningful legal exposure if AI is adopted without proper governance.